Unit III ion

7/31/2019 Unit III ion

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ORGANIZATION


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ORGANIZING-the process of determining and

arrangement of men, material and money

required by a concern to accomplish the

goals. Acc to Koontz and ODonnell- organizing is

the grouping of activities necessary to attain

objectives, the assignment of each grouping

to a manager with authority necessary tosupervise it and the provision for

coordination horizontally and vertically in

the enterprise structure.


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Group of people

Division of labor

Common objective

Structure of authority and responsibility

Co-ordination

Horizontal and Vertical relationship

Organization is a social system.


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It facilitates administration

It facilitates growth and diversification

It encourages creativity and innovation

It provides for optimum use of resources

Facilitates co-ordination and communication

Provides training and development of

personnel

Job satisfaction to employees.


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Unity of objective

Division work and specialization

Principle of functional definition

Scalar principles

Delegation

Parity of Authority and Responsibilities

Unity of CommandUnity of Direction

Exception principle

Span of control


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Efficiency and simplicity

Flexibility and communication


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Determining of Objectives

Identification of the work

Grouping of work

Appointment of suitable personnel

Establishing formal relationship

Delegation of authority and Responsibility

Co-ordination of activities


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LINE ORGANISATION

FUNCTIONAL ORGANISATION

LINE AND STAFF ORGANISATION

PROJECT ORGANISATION STRUCTURE

MATRIX ORGANISATION

COMMITTEE ORGANISATION


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It is the simplest and the oldest form of

internal organisation.

Scalar or vertical organisation .

Authority flows downwards and responsibilityflows upward.


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Board of Directors

Chief Executive

Marketing Manager

Assistant Marketing

Manager

Area Sales Manager

Supervisor

Workers

ResponsibilityAuthority


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1) Simplicity

2) Economical and Effective

3) Effective Communication

4) Unified Control

5) Quick Decision Making

6) Fixed Authority and Responsibility

7) Flexible8) Excellent Discipline


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Lack of Specialization

Autocratic Management

Rigid and Inflexible

Lack of co-ordinationOver loading

Encourage nepotism

Lack of initiative


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All activities of the enterprise are classified

.

A structure is formed by grouping all the

functions into major functional departments. Each department is put under one functional

specialist.


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Board of Directors

Chief Executive

Production Dept Marketing Dept Finance DeptPersonnel

Dept


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Division of Labour and Specialisation

Mass Production

Better Supervision and Control

Skill Development Better Co-ordination

Scope for growth and expansion

Economy and Efficiency suitability


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Difficult to Establish

Multiple Commands

Lack of Co-ordination

Delay in Decision MakingConflicts

Leadership Crisis

Difficulty in Fixing the Responsibility


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Line Managers those people in the

organisation who are directly responsible for

achieving organisational goals.

Staff Authority- those individual who provideservices and advises to line managers.


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Line officers who have the authority and

command over the subordinates and are

responsible for the accomplishment of the

results.

Staff Officers or specialists who render

expert advice to the line officers to help

them to discharge their functions efficiently.


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Advantages of Specialization

Stability and Discipline

Expert Advice

Promote Divisions Training and Development

Line managers can concentrate on their

functions


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Staff grabs credit for work

Staff undermines the line authority

Staff thinks in vacuum

Staff provides impractical and unbalancedadvices

Lack of staff responsibility


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Complicated structure

Loss of initiative

Ineffective staff

Conflict between line and staff


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For the purpose of completing a project.

It is specialised task of an organisation

undertaken with a definite goal and must be

completed within a specified time and cost.Development and introduction of a new

product, installing a new plant, building an

office complex, designing and launching of a

satellite .


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It enables to complete the project

effectively within a specified cost and time.

It facilitates co-ordinated approach and

prompt decision relating to the project. Project organisation allows regular work of

other part of the organisation undistributed

while the project is carried on.

It facilitates effective use of specialistsavailable in the organisation.


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Combination of functional organisation and

project organisation is called Matrix

Organisation.

Group of individuals from various functionaldepartments who are deputed to work full

time in various projects under the guidance

and direction of a project manager.


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Several new projects can be taken up by the

organisation and can be completed within a

specified time and cost.

It provides a flexible structure ideally suited to

the requirements of changing conditions.

It permits optimum development and utilization

of functional specialists.

It promotes specialization as well as lateral co-

ordination of different departments and

projects.

Member of the project team work in different

projects, their knowledge and experience on the

job also increases.


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Is a group of people who meet to plan, to

discuss or to make a decision for a particular

subject.

Formed at various levels of the organisationto go into detail of the problem and to

suggest solution to management.


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It facilitates pooling of collective knowledge

and experience of many persons to solve a

particular problem.

Committee promotes democratic andparticipative management in the org.

It is easy to communicate objectives and

policies of the organisation to various other

departments and units. Sound and balanced decisions can be taken

through committees.


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Committees are expensive in terms of money

and time.

It leads to slow decision making because

preparation and conducting committeemeetings takes long time.

Committee meetings proved to be source of

misunderstanding and conflict rather than

providing a stages for team work and co-ordination.


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Diagrammatic representation of the formal

structure of an organisation.

It is a blue print or model of a company

organisation. Koontz and ODonnel, every organisation

can be charted, for a chart is nothing more

than an indication of how departments are

tied together along with their principal linesof authority.


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Who reports to whom, how many

subordinates reports to a superior, how a

manager can go up in the promotional

hierarchy etc..


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VERTICAL CHART

HORIZONTAL CHART

CIRCULAR CHART OR CONCENTRIC CHART


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Top to down type of organisation chart.

Represents the position of highest authority

at the top and least authority at the bottom.


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Share Holders

Board of Directors

Chief Executive

Production

Manager

Marketing

Manager

Personnel

ManagerFinance

Manager

Work

Superintendent I WorkSuperintendent II

Foreman I Foreman II


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Left to right organizational chart.


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Share

HoldersBoard of

Director

Chief

Executive

Prod

Manager

Mkting

Manager

Personnel

manager

Finance

Manager

Work

Superintendent I

Work

Superintendent

II


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Highest managerial position at the centric,

middle and lower managerial position at the

radiate from the centre in circles, the lowest

managerial positions are placed on the outer

circles.


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Is a small book containing descriptions of

different jobs, procedural rules and

regulations and various other information

relating to the organisation.

It acts as a guide to the organisation

members.


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Statement of organisation of objectives

Organisational policies, procedures, rules

and methods.

Records of top management decisions,standard practices and procedures.

Duties and responsibilities of various jobs.

Authority of each position

Relationship between jobs and positions.


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Policy manual

Operations manual

Organisation manual

Rules and regulations manualDepartmental manual


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Employees are not required to approach their

superiors for every instruction and guidance.

It relieves the managers from the necessity

of repeating the same information again andagain.

From the manuals, employees get clear

understanding of the responsibilities of their

jobs and their relationship with other jobs. It also enables quick decisions as instructions

and policies are stated in definite terms.


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It is a costly and time consuming process.

Manual leave little scope of individual

initiative and direction.

It brings rigidity to the organisation. It mayput on record those relationships where no

one would like to see exposed.


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Organisation is a system of authority and

responsibility relationship.

Authority is the key to managerial job-

Koontz and ODonnel. Authority is the power to command others

to act or not to act in a manner deemed by

the possessor of the authority to further

enterprise or departmental purpose. Allen A Louis- the sum of the powers and

rights entrusted to make possible the

performance of the work delegated.


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Authority is the power to command thesubordinates to get the work done.

Authority is legitimate.

Authority puts the manager in a position by

which he can regulate the behaviour of his

subordinates.

Authority is intended to influence the

behaviour of the subordinates to act or not

to act in a certain way.

The use of authority is determined by the

personal qualities of the possessor of

authority.


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Legal limitations

Internal limitations

Biological limitations

Physical limitations Technological limitations

Economic limitations

Social limitations


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Power is the capacity or ability of the

manager to enforce his right to exert

influence.

In a proper organisation authority and powershould be equated.


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To Delegate means to grant or confer.

Manager grants or confer on others

(subordinates)

Certain duties are in the form of work andauthority.

Delegation means conferring authority from a

manager to his subordinate in order to

accomplish particular assignment. Is an act of assigning formal authority and

responsibility to a subordinate for the

completion of specific activities.


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Acc to F.G.Moore, Delegation means

assigning work to others and give them

authority to do it.

Louis. A.Allen, Delegation is the

entrustment of a part of the work, or

responsibility and authority to another, and

the creation of accountabilities for

performance.


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Delegation implies managers sharing of

power or authority with his subordinates for

the performance of certain task or duties.

Managers delegates the right to act, to make

decisions, to acquire the resources and to

perform other tasks in order to discharge the

assigned duties.

Managers delegate to those they trust andrespect and whose performance they have

observed.


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Delegator must determine the objectives of

delegation clearly in terms of expected

results.

The Delegation creates accountability

(obligation) of the subordinate to his boss to

complete the job.

Delegation is an art.

Delegation may be general or specific.


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Assignment of Responsibility

Granting of Authority

Creation of Accountability


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Delegation is the essence of good

organisation

It promotes job satisfaction and motivates

the subordinates to improve their

performance.

Delegation is an index of decentralization.

Delegation contributes to employee

development.Delegation of authority relives the manager

from the heavy load of work.


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Implies transfer of authority and decisions

making power to the lower levels of

management.

Disposal of management authority from top

management to lower management levels.

Acc to Louis A Allen, Decentralization refers

to the systematic efforts to delegate to the

lowest levels all authority except that whichcan only be exercises at the central points.


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Reduces burden of top management. Facilitates organisational growth and

diversification

Facilitates quick decisions

Promotes development of general managers

Managers enjoy more freedom and

independence.

Effective supervision and control Improved employee morale


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Span of control or span of management

refers to the number of subordinates a

manager can control or manage effectively.

According to Sir. Ian Hamilton, the ideal

number of subordinates for all superior is 3

to 6.

According to J.C.Worthy, a manager can

effectively manage as many as 20subordinates.

According to Graicunas, a superior can

effectively manage 6 subordinates.


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Is a managerial function concerned with

employing and developing human resources

for carrying out the managerial and non-

managerial activities of the enterprise.

It deals with recruitment, placement,

training and development of an organisation

member.

Staffing function includes the activities suchas manpower planning, recruitment,

selection, placement, training and

development, remuneration, performance

appraisal, promotion, transfer etc.


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Koontz and ODonnel- filling positions in the

organisation structure through identifying

workforce requirements, inventorying the

people available, recruitment, selection,

placement, promotion, appraisal,compensation and training of needed

people.

Luther Gulick and Lyndall Urwick, staffing is

the whole personnel function of bringing in

and training the staff and maintaining

favourable conditions of work.


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Staffing assures the quality and quantity of

manpower to meet short term and long term

manpower requirements.

Handling of modern technologies requires

competent and skilled personnel. This

necessitates staffing function to appoint

qualified people and to make use of modern

technologies.

Facilitates efficient allocation and utilization

of all physical, financial and other resources

of the organisation.


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It enables to make best use of skills and

capabilities of employees of the

organisation.

Organisation needs harmonious relationship

between management and staff to achieve

its goals.

System can be developed for measuring the

value of human assets which is the basis forhuman resource accounting.


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ManpowerPlanning

Recruitment

Selectionand

Placement

Promotion, transfer,

demotions and

Separations

Performance

Appraisal

Training and

Development


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Interpersonal process of influencing the

behaviour of individuals and the group so

that defined objectives are accomplished

willingly and enthusiastically.

A leader directs and motivates members of

the group to achieve a defined objective.


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Knootz and ODonnel- leadership is theinfluence, the art or process of influencing

people so that they will strive willingly and

enthusiastically towards the achievement of

group goals.

Stoner and Freeman- managerial leadership

is the process of directing and influencing

the task-related activities of group

members.


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It is an interpersonal relationship b/w two ormore people.

A leader must have followers.

Leadership involves an unequal distributionof power b/w leader and group member.

Leadership is the ability to influence the

follower behavior to fulfill certain pre-

determined objectives. It is a continuous process whereby the

manager influences, guides and directs the

behavior of subordinates.


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The purpose of leadership is to get willingco-operation of the group members in the

achievement of specified goals.

A leader must be intelligent, mentally and

emotionally matured and possess

administrative skills.


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Planning and goal setting

Develops team work

Acts as a representative of subordinates

Acts as a counsellor of people at workMotivation of subordinates

Proper use of power

Time management

Take initiative

Acts as a friend, philosopher and guide


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Autocratic style

Democratic style

Free-rein style


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Whole decision making power lies with theleader.

The leader is expected to define task and

responsibility of group members, decide the

rules and regulations, provide guidance and

instructions necessary.

Subordinates are compelled to follow the

orders given by the leader unquestioningly Subordinates have no opportunity to take

part in goal setting or take initiative or make

suggestions.


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Is effective in unorganized sector whereworkers are illiterates and incompetent.

Where work needs to be done with perfect

accuracy this style is suitable

Quick, uniform and consistent decision

making is possible..

Perfect discipline can be enforced for the

short term.


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Has little concern for the well being ofemployees. Employees suffer from

frustration and low morale.

Subordinates have no sense of belonging to

the organisation and try to work as little as

possible.

This type of leadership kills initiative and

innovative ability of subordinates. Autocratic leadership will not contribute for

the development of future leaders in the

organisation.


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Participative leadership consults withsubordinates on proposed actions and

decisions and encourages participation from

them.

Participative leader decentralizes decision

making process.

Encourages the subordinates to give

suggestions and take initiative in settinggoals and implementing decisions.


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It is most effective and productive.

It results in continuous flow of new ideas and

positive changes.

A sense of group responsibility and improvedquality and quantity of work.

It provides job satisfaction and improve

morale of employees.

It helps the subordinates to develop theirdecision making abilities and assume

responsibilites.


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Democratic leadership necessitatesconsultations and compromises before taking

decisions. Thus decision making may be

delayed.

It leads to irresponsibility.


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Opposite of autocratic style

Leader gives the subordinates a high degree

of independence in their operations.

Leader formulates the policies andprogrammes and the entire decision making

process is left to the subordinates.

The group members enjoy full freedom as

regards goal setting and acting on it theymust plan, motivate, control and provide

their own motivations.


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The role of leader is very limited.

He just acts as a contact person b/w the

group and outside person to provide

necessary information.


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It ensures maximum Initiativeness and highlevel of creativity by the subordinates.

It makes every individual responsible for the

performance of the group activity

It provides for the development of future

leaders at different levels.


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Suitable only where subordinates are trained,competent and matured. Otherwise it leads

to chaos and mismanagement of group goals.

It may lead to inter-departmental and intra-

departmental conflicts . It may create

indiscipline in the organisation.


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Unit III ion

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